Dubai International Financial Centre (DIFC) has launched a public consultation on a proposed set of Variable Capital Company (VCC) Regulations aimed at offering a new vehicle for proprietary investment.
According to the DIFC Authority, the VCC regime would provide an alternative investment structure that does not require regulatory approval from the Dubai Financial Services Authority (DFSA) or the use of a licensed fund manager—unless the VCC engages in regulated financial activities.
The proposed structure allows a VCC to be incorporated as a standalone company or as an umbrella entity with incorporated or segregated cells. These cells would allow for multiple investment strategies or asset pools to be managed separately within the same legal framework, offering asset and liability segregation.
Share capital would be tied to the net asset value (NAV), allowing shares to be issued and redeemed flexibly and distributions to be made not just from profit but also from capital based on the NAV of the company or its respective cells. This provides firms with greater discretion in capital management and the distribution of returns.
Jacques Visser, Chief Legal Officer at the DIFC Authority, said the VCC is targeted at proprietary investment entities, such as family offices, secondary asset structures, and holders of high-value multi-asset portfolios, seeking to consolidate their investments under a more adaptable regime.
The framework would also support economies of scale by enabling centralised oversight while keeping separate risk exposures within individual cells. Stakeholders have been invited to submit feedback during the public consultation period.
